(IBM), is by far one of the oldest tech companies in the current space. Despite the change in tide with the coming of belligerent competitors like Apple (AAPL), IBM has managed to maintain its inherent luster. To make things easier for the company, some of its core competitors are shooting themselves in the foot. A good example is Hewlett Packard (HPQ). All this coupled with strong fundamentals spells a lot of hope for IBM in the long haul.

What direction is IBM headed on an operational basis? IBM is headed in the right direction. In as much as it can’t be a pace setter with regard to contemporary technological trends (not with Apple and Google (GOOG) around), it shows a lot of promise and is steering the right path.

Going social

The social arms race — everyone’s doing it. Social is the current fad and a new foundation in contemporary technology, more so in the Internet industry.

Big names like Microsoft (MSFT) have already gone social. In fact, Microsoft just recently added Yammer to its stable.

IBM has now joined this ever-growing list and in doing so has gone a step further to add its own proprietary products into the picture. The 101-year-old technological big wig has come up with a set of customized social products that are exclusively tailored to meet the varied needs of employees. My take: brilliant!

Why is this move brilliant? Well for starters, being technologically forward always goes well with stakeholders. However, most importantly, integrating social will create a common platform across all departments and streamline activities. This means that marketers, finance experts, IT specialists and virtually everyone in IBM will have the opportunity to work from one platform. This will definitely bolster growth and development.

In addition to that, the move will expand the sources of information available to IBM employees. This will be more than beneficial to the technological titan.

With this achievement to add to its name, IBM certainly treads several paces ahead of close competitors like Hewlett-Packard.

Hewlett-Packard is stuck in a rut. For the last decade, the hardware guru has placed most, if not all, of its efforts into meaningless acquisitions.

A pile of acquisitions and nothing to show for it

With the most recent $10 billion acquisition being Autonomy, a selfless niche software company, HP has raised a lot of questions. No one really knows whether it is interested in software or hardware.

Over the past decade, Hewlett-Packard has recorded a series of no-so-successful acquisitions. If you look back to the beginning of the new millennium, you will note that HP made a landmark $25 billion acquisition when it placed Compaq into its shopping basket. Later, this proved to be nothing but more zeros on its balance sheet with nothing to show for it. HP did not make notable advancements and still languished in competition from its competitors.

Subsequent years were rather silent as HP was still stuck at the drawing board in search of a comeback plan. In 2010, the $1.2 billion palm acquisition failed to generate any ripples and was later scrapped.

It is quite evident that HP has some serious work to do. It’s going to take a lot more than a $10 billion acquisition to restore the eroded investor confidence. In the meantime, investors will move to more promising options like IBM while HP lingers in the shadows.

Microsoft preparing its arsenal; the union is coming

It’s going to be a scene straight out of Armageddon when the union comes for Microsoft. Cutting several hundred jobs in the current economy is a sure way of attracting activists from the union and unnecessary rants and rambles.

While it worries about that and the probable costs of litigation (my foresight of course), mounting pressure of failure in the smartphone industry balloons with the wake of each day. In fact, by September, Apple will launch a new smartphone. Where will Microsoft be by then?

In conclusion, I must say that IBM has the edge against its competitors at the moment. It has a unique business model and is better-placed in the industry. Likewise, things are looking up for it amid uncertainty in some of its closest competitors’ turf.

I recommend a buy on IBM.

About the author:

Muhammad Bazil

Muhammad Bazil is a financial journalist and editor for a variety of websites, public policy organizations, and book publishers. He has written hundreds of published articles and blog posts on topics including budgeting, credit management, real estate and investing. His articles have been featured on the homepage of Yahoo!, MSN and numerous local news websites.

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